A true capitalist never parts fools from their money: Chris MacDonald

There’s a sucker born every minute. When you spot him, you should let him keep his money and move along.

Actually, statistically it’s quite a bit more than one sucker per minute. According to a recent study, roughly half of Americans believe at least one medical conspiracy theory, the kinds of theories that strain credulity. The theories researchers asked about included, for example, “the theory that the government knows cell phones cause cancer but does nothing about it, that genetically modified organisms are being used to shrink the world’s population, that routine vaccinations cause autism and that water fluoridation is a way for companies to dump dangerous chemicals into the environment.”

So half the U.S. population, it seems, believes in things slightly less plausible than the Easter Bunny. That’s a lot of people failing to make sufficient use of critical thinking skills. (For those of you keen on the math: there are about four million U.S. births per year, and a little over half a million minutes in a year, which means eight births per minute. If half of them eventually believe implausible theories, that means not just one but four suckers per minute.)

For medical educators and public health authorities, this is naturally quite worrisome. Anti-vaccination types are risking their children’s lives, along with the lives of other people’s children. And irrational fear of GM crops is holding back research that could contribute to fighting world hunger.

But of course, for others the gullibility of a large segment of the population isn’t a worry, but a business opportunity. You can, after all, make money selling stuff to people who believe weird things. Rational consumers buy things based on a well-informed estimation of the costs and benefits and an understanding of their own needs. But many people are not even roughly rational, and this opens up opportunities for unscrupulous businesses. When people are paranoid about vaccination, for example, you can sell them so-called “homeopathic vaccines” (which are of course useless). When people are sufficiently worried about the genetic origins of their food, you can sell them organic or “GM-free” foods (not proven to be any safer) at a premium. And when people can be convinced that government is “hiding” genuine cures at the bidding of Big Pharma, you can successfully market naturopathic remedies that are grounded in no credible evidence at all.

Further, when you combine lack of scientific sophistication with lack of financial literacy and business acumen, you can sell people membership in multi-level marketing schemes that involve buying-and-selling a range of herbal remedies, weight-loss products and nutritional supplements (like Herbalife, Usana, etc.) The health benefits of such products, and the financial benefits of such schemes (to those not at the top of the pyramid) are far from well established.

But then, we’re talking about business, and business is a tough game, right? Well, yes and no. It’s a tough game—and indeed society benefits from the fact that it’s a tough, competitive game—but it’s a tough game with rules. And some of those rules are written into the very requirements that must be in place for markets to operate efficiently, including the requirement that consumers be well informed. Even if we set aside grand notions of market efficiency, and focus just on the requirements for engaging in sustained patterns of trade, we bump into limits on the “tough game” argument. To engage in commerce implies a commitment to a set of principles, adherence to which is essential to carrying out trade at all. This includes, for example, a commitment to non-violence and basic honesty.

And in fairness, it’s not just the fools that are vulnerable. None of us is omniscient, so in participating in markets we need to be able to rely on the basic decency of our fellow humans not to take advantage of our moments (or months) of weakness. There’s a lesson here for business. To be a true capitalist in the best sense of the word means a commitment to basic honesty. And sometimes that means letting suckers keep their money.

Chris MacDonald is director of the Jim Pattison Ethical Leadership Education & Research Program at the Ted Rogers School of Management